Overview
Jialijia Group Corporation Limited, formerly known as Rizzen, Inc. (the
"Company") was incorporated as a corporation under the laws of the State of
Nevada on October 21, 2015. On May 16, 2018, our Articles of Incorporation were
amended to change our name to Jialijia Group Corporation Limited and increase
the number of authorized shares the corporation from 75,000,000 to
1,000,000,000.
Effective as of December 15, 2018, the Company appointed: (i) Mr. Dongzhi Zhang
as the Chairman of the Board; (ii) Mr. Jiannan Wu as the Company's General
Manager and Director; and (iii) Ms. Weixia Hu as the Company's Chinese Region
Chief Representative. Ms. Na Jin is our CEO, CFO, Secretary and a director.
Jialijia Group Corporation Limited, formerly known as Rizzen, Inc. (the
"Company") was incorporated as a corporation under the laws of the State of
Nevada on October 21, 2015 and has been inactive since our change in control on
December 30, 2016. Following our change,
On July 10, 2019, the Company entered into a share purchase/exchange agreement
(the "Share Exchange Agreement") with Huazhongyun Group Co., Limited
("Huazhongyun," formerly known as "JLJ Group Corporation Limited"), a company
formed under the laws of the Hong Kong Special Administrative Region, and Na
Jin, the sole shareholder of Huazhongyun and the Chief Executive Officer and
Chief Financial Officer of the Company. Na Jin, through Huazhongyun, owned
6,000,000 shares (the "Company Shares") of the Company, which represented
approximately 82% of the shares of the Company's common stock, issued and
outstanding, par value $0.001 per share, as of the date of execution of the
Share Exchange Agreement. Na Jin owned an aggregate of 10,000 ordinary shares of
Huazhongyun ("Huazhongyun Shares"), which constituted all of the issued and
outstanding ordinary shares of Huazhongyun. On the date of execution of the
Share Exchange Agreement, Huazhongyun owned all of the equity interests in
Jialijia Jixiang Investment (Changzhou) Co., Ltd. ("WFOE"), a wholly-foreign
owned entity formed under the laws of China, which in turn held seventy percent
(70%) of the outstanding equity interest in Rucheng Wenchuan Gas Co., Ltd. (the
"Rucheng Wenchuan"), a company formed under the laws of China.
Pursuant to the Share Exchange Agreement, on August 29, 2019 (the "Closing
Date"), Na Jin sold and transferred all of the Huazhongyun Shares to the Company
in exchange for all of the Company Shares and the Company received all of the
outstanding Huazhongyun Shares. As a result, on the Closing Date, Na Jin
directly owned Company Shares representing approximately 48% of the issued and
outstanding shares of the Company's common stock, Huazhongyun became a
wholly-owned subsidiary of the Company, and the Company owned 70% of the
outstanding equity interest in Rucheng Wenchuan through Huazhongyun and WFOE.
From July 22, 2019 to July 29, 2019, the Company entered into a securities
subscription agreement (the "Subscription Agreement") with fifty-four (54)
investors (the "Investors") who reside outside the United States where the
Investors purchased an aggregate of 3,011,483 shares of the Company's common
stock, par value $0.001 per share, at a price of $0.03 per share. Pursuant to
each of the Subscription Agreements, the Company issued its shares of common
stock to each Investor in the respective amounts as set forth in the
Subscription Agreement and received the funds in the corresponding amounts as
set forth therein. In addition, on April 20, 2019, Ms. Na Jin, the Chief
Executive Officer of the Company, entered into a Subscription Agreement to
purchase 1,000,000 shares of the Company's common stock at a price of $0.01 per
share, for a total purchase price of $10,000, which purchase was consummated on
July 24, 2019.
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As a result of the consummation of the above merger on August 29, 2019, we
entered into the business of producing and selling gases, such as oxygen and
nitrogen, for industrial and medical purposes in the PRC. In 2020, the COVID-19
pandemic materially and adversely affected economic conditions and our operating
results. As a result, we were unable to obtain the financing necessary to pursue
this business.
Effective July15, 2020, we engaged in a one for twenty reverse stock split of
our common stock whereby each twenty shares of common stock were reduced into
one share of common stock with fractional shares rounded to one whole share. All
descriptions of securities issuances occurring prior to such reverse stock split
are provided on a pre-reverse basis.
We are currently a "shell company" with no meaningful assets or operations other
than our efforts to identify and merge with an operating company.
Our principal business is to achieve long-term growth potential through a
combination with a business rather than immediate, short-term earnings. Based on
proposed business activities, we are a "blank check" company. We intend to
comply with the periodic reporting requirements of the Exchange Act for so long
as it is subject to those requirements.
Results of Operations for the Years Ended December 31, 2019 Compared to the Year
Ended December 31, 2018
For the Years Ended
December 31,
2019 2018
Net Revenue $ - $ -
Total Operating Expenses 4,907,557 29,268
Net Loss $ 4,907,557 $ 29,268
Revenues
The Company did not commence operations and did not generate any revenues for
the years ended December 31, 2019 and 2018.
Operating Expenses
Operating expenses for the years ended December 31, 2019, and 2018, were
$4,907,557 and $29,268, respectively. Operating expenses for the year ended
December 31, 2019, consisted primarily of goodwill impairment of $3,962,424
arising from the acquisition of Rucheng Wenchuan, general and administrative
expenses of $603,336 and fixed asset impairment of $341,797 for plant, machinery
and equipment no longer being utilized in production. Operating expenses for the
year ended December 31, 2018, consisted solely of general and administrative
expenses of $29,268.
Net Loss
As a result of the above factors, the Company incurred a net loss of $4,907,557
and $29,268 for the years ended December 31, 2019 and 2018, respectively.
Foreign Currency Translation Gain (Loss)
The Company had $28,502 in foreign currency translation gain during the year
ended December 31, 2019 as compared to $44 in foreign currency translation loss
during the year ended December 31, 2018, reflecting a change of $28,546. Such
increase in foreign currency translation gain was primarily caused by the
currency exchange rate fluctuation.
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Liquidity and Capital Resources
The following summarizes the key component of our cash flows for the years ended
December 31, 2019 and 2018:
For the Years Ended
December 31, December 31,
2019 2018
Net cash used in operating activities $ (216,088 ) $ (135,303 )
Net cash used in investing activities
(135,935 ) -
Net cash provided by financing activities 352,448 135,360
Net increase in cash and cash equivalents $ 382 $ 13
Net cash used in operating activities was $216,088 for the fiscal year ended
December 31, 2019, compared to that of $135,303 for the fiscal year ended
December 31, 2018. The increase of $80,785 or 59.71% of net cash used in
operating activities was primarily due to the increase in net loss during the
year ended December 31, 2019, partially offset by the non-cash items including
depreciation, fixed assets and goodwill impairment.
Net cash used in investing activities was $135,935 and $0 for the years ended
December 31, 2019 and 2018, respectively. Net cash used in December 31, 2019,
was attributable to the acquisition of our operating subsidiary and affiliated
entities on August 29, 2019.
Net cash provided by financing activities was $352,448 and $135,360 for fiscal
years ended December 31, 2019 and 2018, respectively, representing an increase
of $217,088 or 160.38%. The increase in net cash provided by financing
activities was primarily attributable to advances from officers for working
capital purpose and cash proceeds from sale of common stock.
Working Capital:
As of December 31, 2019 and 2018, we had cash and cash equivalent of $395 and
$13, respectively. As of December 31, 2019, we have incurred accumulated
operating losses of $4,806,088 since inception. As of December 31, 2019 and
2018, we had working capital deficits of $3,088,770 and $171,813, respectively.
Going Concern:
We require additional funding to meet its ongoing obligations and to fund
anticipated operating losses. Our auditor has expressed substantial doubt about
our ability to continue as a going concern. Our ability to continue as a going
concern is dependent on raising capital to fund its initial business plan and
ultimately to attain profitable operations. These financial statements do not
include any adjustments relating to the recoverability and classification of
recorded asset amounts, or amounts and classification of liabilities that might
result from this uncertainty.
We expect to incur marketing and professional and administrative expenses as
well expenses associated with maintaining our filings with the Commission. We
will require additional funds during this time and will seek to raise the
necessary additional capital. If we are unable to obtain additional financing,
we may be required to reduce the scope of our business development activities,
which could harm our business plans, financial condition and operating results.
Additional funding may not be available on favorable terms, if at all. We intend
to continue to fund its business by way of equity or debt financing and advances
from related parties. Any inability to raise capital as needed would have a
material adverse effect on our business, financial condition and results of
operations.
If we cannot raise additional funds, we will have to cease business operations.
As a result, our common stock investors would lose all of their investment.
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Critical Accounting Policies
Our financial statements and accompanying notes have been prepared in accordance
with United States generally accepted accounting principles applied on a
consistent basis. The preparation of financial statements in conformity with
United States generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities, the disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting periods.
We qualify as an "emerging growth company", as defined in the Jumpstart Our
Business Startups Act, which became law in April, 2012. Under the JOBS Act,
"emerging growth companies", can delay adopting new or revised accounting
standards until such time as those standards apply to private companies. We have
elected not to avail ourselves of this exemption from new or revised accounting
standards and, therefore, will be subject to the same new or revised accounting
standards as other public companies that are not emerging growth companies
Use of estimates
The preparation of the financial statements in conformity with U.S. GAAP
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements, as well as the reported
amounts of revenues and expenses during the reporting periods. Management makes
these estimates using the best information available at the time the estimates
are made; however actual results could differ materially from those estimates.
Income Taxes
We accounts for income taxes as outlined in ASC 740, "Income Taxes". Under the
asset and liability method of ASC 740, deferred tax assets and liabilities are
recognized for the estimated future tax consequences attributable to differences
between the financial statement carrying amounts of existing assets and
liabilities and their respective tax bases. Deferred tax assets and liabilities
are measured using enacted tax rates in effect for the year in which those
temporary differences are expected to be recovered or settled.
Loss per Share Calculation
We comply with accounting and disclosure requirements of ASC 260, "Earnings Per
Share." Net loss per common share is computed by dividing net loss applicable to
common stockholders by the weighted average number of common shares outstanding
for the period. For the years ended January 31, 2019 and 2018, we did not have
any dilutive securities and other contracts that could, potentially, be
exercised or converted into common stock and then share in the earnings of us.
As a result, diluted loss per common share is the same as basic loss per common
share for the periods.
Fair values of financial instruments
ASC 820 defines fair value as the exchange price that would be received for an
asset or paid to transfer a liability (an exit price) in the principal or most
advantageous market for the asset or liability in an orderly transaction between
market participants on the measurement date. ASC 820 also establishes a fair
value hierarchy, which requires an entity to maximize the use of observable
inputs and minimize the use of unobservable inputs when measuring fair value.
ASC 820 describes three levels of inputs that may be used to measure fair value:
Level 1 - quoted prices in active markets for identical assets or liabilities.
Level 2 - quoted prices for similar assets and liabilities in active markets or
inputs that are observable
Level 3 - inputs that are unobservable
There were no assets or liabilities measured at fair value on a recurring basis
subject to the disclosure requirements of ASC 820 as of January 31, 2019 and
2018.
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Recent Accounting Pronouncements
Management has evaluated all the recently issued accounting pronouncements and
does not believe that they will have a material effect on the Company's
financial position and results of operations.
Off-balance Sheet Arrangements
As of January 31, 2019 and 2018, there were no off-balance sheet arrangements.
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JIALIJIA GROUP CORPORATION LIMITED 
